RIL, IPCL board approves merger

Mumbai, Apr 18 (UNI) The Board of Directors of Reliance Industries Ltd (RIL) and Indian Petrochemicals Corporation Limited (IPCL) have unanimously approved the scheme of merger of both the entities, subject to the necessary regulatory and shareholders' approvals.

RIL is India's largest private sector company with a leadership position in the petrochemicals industry, while IPCL is India's second largest company in that sector.

As part of the divestment programme of the Government of India, RIL has acquired 26 per cent equity in IPCL in the year 2002 and thereafter, increased its holding to 46 per cent through an open offer.

Commenting on the merger, RIL chairman and managing director Mukesh D Ambani said ''With this merger, I am happy to welcome all IPCL shareholders to the RIL family. This merger will create value through synergies and scale that shall enhance the sustainable competitive advantages of RIL.'' Over the last five years of IPCL's operations, with the support of Reliance management, several initiatives were introduced to increase capacity utilisation, reduce operating costs and improve financial management.

RIL has a diversified portfolio of businesses in the form of oil and gas, refining and marketing, petrochemicals, organised retail and development of special economic zones (SEZs).

The merger provides shareholders of IPCL an opportunity to de-risk their investment by participating in the growth opportunities at RIL.

The merger will also facilitate the integration of management resources with economic interest while providing for free flow of products and intellectual capital between the two companies.

UNI